Exporter confidence retreats on global growth concerns and European instability
OTTAWA - Exporter confidence retreated from its spring rebound amid renewed concerns about the global economy and Europe's fiscal struggles, according to a semi-annual survey of Canadian exporters and investors by Export Development Canada (EDC).
Despite the concerns, most Canadian companies have a positive outlook about their domestic and international sales over the next six months. Nine out of ten Canadian companies surveyed believed that their domestic and international sales will increase or remain the same throughout the winter.
"Since the fall of 2009, bullish exporter sentiment in the spring has given way to pessimism in the fall every year," said Peter Hall, Chief Economist, EDC. "This movement is not surprising given the mid-year softening that has occurred in each of the last three years. Volatility is also likely a by-product of global pessimism, which has prompted quick overreactions to negative developments."
"Given the pitiful state of global confidence, Canadian exporters remain surprisingly upbeat."
EDC's Trade Confidence Index (TCI) examines the attitudes of Canadian exporters as they forecast the business environment over the next six months through five index elements: trade opportunities, export sales, domestic sales, and both domestic and global economic conditions.
The TCI score overall moved down to 70.7, from 75.9 in the spring of 2012. The current score remains consistent with normal economic conditions, however.
The survey was conducted in late September and early October 2012. A total of 1,000 Canadian businesses participated, and the TCI was calculated on a total of 797 respondents.